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TMI BlogMeetings of the Board of DirectorsX X X X Extracts X X X X X X X X Extracts X X X X ..... ompany. They owe a duty to the shareholders and should exercise care, skill and diligence in the discharge of their functions and in the exercise of the powers vested in them. All the powers vested in Directors are exercisable by them only collectively. As an individual Director, no Director has the power to act on behalf of the company unless such powers have been delegated to him by the Board. Definitions The following terms are used in this Standard with the meaning specified: "Act" means the Companies Act, 1956 (1 of 1956), or any statutory modification or re-enactment thereof and includes any Rules and Regulations framed thereunder. "Article" means the Articles of Association of a company, as originally framed or as altered from time to time, including, where they apply, the Regulations contained in the Tables in Schedule I to the Act. "Board" means the Board of Directors of a company. "Chairman" means the Chairman of the Board, or the Chairman appointed or elected for a Meeting. "Committee" means a Committee of the Board. "Disinterested Director" means a Director who is not an "Interested Director". "Interested Director" means a Director whose presence cannot count f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hould be given atleast fifteen days before the date of the Meeting. Notice need not be given of an adjourned Meeting other than a Meeting that has been adjourned "sine die". However, Notice of the reconvened adjourned Meeting should be given to those Directors who did not attend the Meeting which had been adjourned. 1.2-5 No business should be transacted at a Meeting if Notice in accordance with this Standard has not been given. 1.2-6 The Agenda, setting out the business to be transacted at the Meeting, and Notes on Agenda should be given at least seven days before the date of the Meeting. 1.2-7 Each item of business should be supported by a note setting out the details of the proposal and, where approval by means of a Resolution is required, the draft of such Resolution should be set out in the note. 1.2-8 The Notice, Agenda and Notes on Agenda may be given at shorter periods of time than those respectively stated above, if the majority of members of the Board or of the Committee, as the case may be, agree. The proposal to hold the Meeting at a shorter notice should be stated in the Notice and the fact that consent thereto was obtained should be recorded in the Minutes. Noti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contained in that one-third being rounded off as one), or two Directors, whichever is higher. Where the requirements for the Quorum, as provided in the Articles, are stricter, the Quorum should conform to such requirements. If the number of interested Directors exceeds or is equal to two-thirds of the total strength, the remaining Directors present at the Meeting, being not less than two, should be the quorum during such time. 3.1-2 Where the number of Directors is reduced below the minimum fixed by the Articles, no business should be transacted unless the number is first made up by the remaining Director(s) or through a general meeting. If a Meeting of the Board could not be held for want of quorum, then, unless the Articles otherwise provide, the Meeting should automatically stand adjourned to the same day in the next week, at the same time and place or, if that day is a public holiday, to the next succeeding day which is not a public holiday, at the same time and place. 3.2 Meetings of Committees The presence of all the members of any committee constituted by the Board is necessary to form the Quorum for meetings of such Committee unless otherwise stipulated by the Board w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Chairman of that Committee, unless such appointment is to be made in pursuance of any other applicable guidelines, Rules or Regulations. 6. Passing of resolution by Circulation 6.1 A Resolution proposed to be passed by circulation should be sent in draft, together with the necessary papers, individually to all the Directors or, in the case of a Committee, to all the members of the Committee. The Act requires certain matters to be approved at Meetings of the Board of Directors only. Though the Act permits that all other matters can be approved by means of Resolutions by circulation, it would be appropriate if only those matters, which are of an urgent nature are approved by means of Resolutions by circulation. 6.2 The draft Resolution to be passed by circulation and the necessary papers should be circulated by hand, or by post, or by facsimile, or by e-mail or by any other electronic mode. 6.3 The Resolution should be deemed to have been passed on the date on which it is signed and dated as approved by all the Directors then in India, being not less than the Quorum, or on the date on which it is approved by the majority of the Directors entitled to vote on the Resolution, whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the succeeding Meeting is held after a period of thirty days from the date of the earlier Meeting. However, it is also not obligatory to wait for the next Meeting in order to have the Minutes of the previous Meeting signed. Such Minutes may be signed by the Chairman of the Meeting at any time before the next Meeting is held. The Minutes of Meetings of the Board can be inspected only by the Directors. While the Auditor or Cost Auditor of the company or secretary in whole-time practice appointed by the company can also inspect the Minute Books in the course of audit or certification, a member of the company has no right to inspect the Minutes of Meetings of the Board or any Committee thereof. Officers of the Registrar of Companies, or other Government or regulatory bodies duly authorised in this behalf under law, during the course of an inspection, can also inspect the Minutes. 8.5 Minutes should not be pasted or attached to the Minutes Book. 8.6 Minutes, if maintained in loose-leaf form, should be bound at intervals coinciding with the financial year of the company. The pages of the Minutes Book should be serially numbered and there should be proper locking device to ensure sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e identity of the transferor company may not survive such arrangement. 10.3 Office copies of Notices, Agenda and Notes on Agenda and other related papers should be preserved in good order for as long as they remain current or for ten years, whichever is later, and may be destroyed thereafter under the authority of the Board. 11. Disclosure The Annual Report of a company should disclose the number of Meetings of the Board and Committees held during the year indicating the number of Meetings attended by each Director. Effective Date This standard shall come into effect from 13th December, 2001. Annexure 'A' Illustrative list of items of business which should be placed before the Board 1. Calls on shareholders in respect of money unpaid on their shares. 2. Issue of debentures. 3. Borrowing money otherwise than by issue of debentures. 4. Investing the funds of the company. 5. Making loans. 6. Filling casual vacancies in the office of Directors. 7. Making donation to political parties. 8. Granting loans to Directors. 9. According sanction for specified contracts in which one or more Directors are interested and to sign the Register of Contracts. 10. Disclosure of intere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h respect to pricing/realisation arising out of change in the regulatory framework; (g) litigation/dispute with a material impact; (h) revision in ratings assigned by credit rating agencies; (i) issue of any class of securities; (j) acquisition, merger, demerger, amalgamation, restructuring, scheme of arrangement, spin off of divisions of the company; (k) change in market lot and sub-division of equity shares of the company; (l) voluntary delisting of securities from the Stock Exchange(s); (m) default in the repayment of any deposits or redemption of any securities including debentures and in payment of interest, if any, due thereon; (n) any action which will result in alteration in the terms regarding redemption/cancellation/retirement in whole or in part of any securities issued; (o) information regarding opening, closing of status of ADR, GDR or any other class of securities issued abroad; (p) cancellation of dividend/rights/bonus, etc.; (q) formation of a subsidiary company and/or de-subsidiarisation of an existing subsidiary company. Annexure 'B' Illustrative list of items of business for the Agenda for the First Meeting of the Board of Directors of the company 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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